It is NOT members' money!!

One of the most common phrases you hear around association and professional body board tables is: “We need to be careful, this is members’ money we’re spending after all.”

It sounds prudent, even noble. After all, boards should be cautious stewards of resources, right? But that phrase is more than a harmless shorthand. It’s misleading, and it can do serious damage to effective governance.

Let’s be absolutely clear: once a member pays their membership fee, that money ceases to be “theirs.” It becomes the legal asset of the organisation. From that point forward, directors are bound by law and duty to manage those assets in line with the organisation’s objects, governing documents, and fiduciary obligations. Members cannot call up the association demanding “their share” of a budget line, any more than a customer can walk back into a supermarket and insist on controlling how the store reinvests its revenues.

To use a simple analogy: when you buy a bag of shopping, you don’t get to dictate whether the supermarket uses the money to pay staff wages, invest in a new warehouse, or test an innovative product line. Your payment secures you the groceries you wanted and the transaction is complete. Similarly, when members pay their fees, they are purchasing a bundle of rights and services: representation, professional recognition, networking, training, or whatever else the organisation promises. That’s the deal.

So why does the phrase “members’ money” cause so much trouble?

1. It Paralyzes Decision-Making

When board members cling to the idea that every pound spent belongs directly to the membership, they risk over-consulting or second-guessing decisions that are rightly theirs to make. Boards exist to make informed, timely decisions in the best interests of the organisation. If every initiative is slowed or stalled by the fear of spending “members’ money,” the organisation becomes reactive instead of proactive.

2. It Undermines Board Authority

Boards have authority because the membership delegates it to them, through elections and constitutional arrangements. When directors defer every significant decision back to the idea of “members’ money,” they effectively hand that authority back, but without a workable mechanism for members to exercise it. The result is a vacuum, where strong governance should be.

3. It Stifles Innovation and Creativity

Associations and professional bodies face the same pressures as any other organisation: technological change, shifting demographics, economic uncertainty, and evolving member expectations. Innovation (new services, digital platforms, partnerships) often requires upfront investment. If directors are constantly worried about being accused of misusing “members’ money,” they’re less likely to take the calculated risks needed to keep the organisation relevant. The consequence? Stagnation.

4. It Creates a False Sense of Ownership

The phrase also blurs the line between membership and shareholding. Members of professional bodies are not shareholders. They don’t have equity, nor can they expect dividends. They have rights (voting, influencing strategy through AGMs, receiving services, etc) but they don’t own the organisation’s assets. Treating members as if they were shareholders risks creating expectations the organisation cannot legally or practically meet.

Why Does This Myth Persist in Nonprofit Boardrooms?

If the concept is so clearly flawed, why does it keep showing up in nonprofit and membership organisations? There are several reasons:

1. Emotional connection: Many directors and staff are also members themselves. They empathise with the lived experience of paying fees and understandably feel protective about how that money is used. This emotional connection can cloud the legal and governance reality.

   
   

2. Cultural legacy: In many associations, especially those with long histories, there has always been a culture of referring to resources as “members’ money.” The phrase gets passed down from one generation of leaders to the next, unchallenged, until it becomes ingrained language.

   
   

3. Desire for accountability: Boards use the phrase as a signal of prudence: “we must be careful with members’ money” is often code for “we must be transparent and accountable.” Unfortunately, the shorthand is inaccurate and ends up perpetuating misunderstanding rather than clarity.

   
   

4. Blurring of roles: In smaller or volunteer-led organisations, the distinction between being a member, a volunteer, and a director often blurs. A board member may subconsciously slip into thinking like a paying customer, not a trustee of corporate assets.

   
   

5. Fear of member backlash: Some directors worry that members will accuse them of being wasteful or self-serving. Referring to funds as “members’ money” becomes a defensive mechanism: a way of showing loyalty to the membership, even if it undermines governance discipline.

   
   

6. Lack of governance training: Few volunteer directors receive robust governance development beyond a one-day induction or legal briefing. Without deeper engagement with the principles of stewardship, fiduciary duty, and corporate purpose, misconceptions like this go unchallenged.

In short, the phrase persists because it feels safe, familiar, and deferential, even though it creates more problems than it solves.

What’s the Alternative?

None of this is to suggest that members’ voices don’t matter. On the contrary, associations exist for their members; but the responsibility of the board is not to manage individual wallets but to steward collective resources in pursuit of the organisation’s mission.

A more accurate phrase might be “These are the organisation’s assets, held in trust to deliver value to members and society.” That reflects both the legal reality and the spirit of stewardship.

Boards should focus on three things instead:

• Transparency: publish clear, accessible accounts and explain major spending decisions.

• Engagement: involve members in strategy-setting and horizon scanning, so they understand why resources are being deployed in particular ways.

• Impact: demonstrate how spending translates into tangible benefits for members and the profession.

When members can see the link between their fees and the outcomes delivered through stronger advocacy, better services, and enhanced professional recognition they are less concerned with the idea of “their money” and more supportive of the organisation’s direction.

Shifting the Conversation

Changing language may seem like a small step, but it matters. Language shapes culture, and culture shapes behaviour. If a board regularly frames its discussions around “members’ money,” directors will act defensively, deferentially, and cautiously. If instead they frame it around “the organisation’s assets and how best to deploy them,” they’ll act strategically, confidently, and creatively.

Professional bodies and associations need the latter mindset if they are to thrive in today’s environment. Members expect more value, delivered faster and more flexibly. Regulators expect higher standards of governance and transparency. Technology offers new opportunities for connection and innovation, but also demands investment.

Boards cannot afford to let outdated language undermine their authority or their agility.

So next time someone at the table says, “But this is members’ money we’re spending,” pause and correct the record. It isn’t. It’s the organisation’s money and the board’s duty is to use it wisely, boldly, and in line with the mission. That’s how you serve members best.